New Zealand Won’t Bail Out Indebted Pacific Islands: Key

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New Zealand Won’t Bail Out Indebted Pacific Islands: Key PM says any loans, including those from China, need to be repaid

WELLINGTON, New Zealand (Radio New Zealand International, June 6, 2014) – The New Zealand Prime Minister is warning Pacific countries that if they cannot pay their debts to other countries, New Zealand will not be bailing them out.

John Key was responding to questions about the influence of China as an aid donor in the Pacific, and as a provider of low-interest loans.

Speaking from Tonga, he said New Zealand is not concerned about China's presence, and Pacific countries are free to chose who they receive money from.

"If they take loans from China, as we say about the same thing about any loans they might take, look in the end you got to recognise that New Zealand does not bail out other loans that you might take from another nationality as long as you are comfortable with that, as long as your lenders are comfortable, then that's fine," says Key.

The Tongan prime minister, Lord Tu'ivakano, says Tonga is not going to turn down loans that are much more affordable than those offered by commercial banks.

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